Dan O’Dowd of Green Hills Software, who spent $600,000 for 30 seconds of air time in certain regional markets, said the National Highway Traffic Safety Administration (NHTSA) recall of Tesla’s cars equipped with its self-driving software proved he was right. But the businessman blasted the proposed regulatory fix as “woefully inadequate.” 

“We’re glad that Tesla has finally acknowledged that the flaws we found in our tests are true and real,“ O’Dowd said in a statement on Thursday. “To that extent, we have achieved our goal.”

On Wednesday, NHTSA published a report saying Tesla had agreed to a recall virtually all 362,758 vehicles vehicles that had Full Self-Driving (FSD), the $15,000 optional package that includes its most advanced feature.

In addition to hundreds of thousands of vehicles in the U.S., another 20,667 were reportedly affected in Canada. This constitutes the overwhelming bulk of approximately 400,000 cars across both countries that had FSD Beta enabled, according to Tesla.

This week’s recall is the single greatest instance of regulatory enforcement taken against FSD to date. A smaller February 2022 recall was issued to fix a rolling stop, when only about 60,000 cars had the developmental software installed. 

While further regulatory action cannot be excluded, NHTSA’s immediate criticism of the system was limited to just a few specific traffic situations and not FSD’s performance more broadly.

Investigation remains ‘open and active’

The U.S. traffic safety authority concluded that Tesla vehicles equipped with FSD were “unsafe around intersections” and behaved in certain cases “without due caution.” 

The precise nature of the problem as described by NHTSA included numerous conditionals and caveats that indicate the risks are not necessarily grave. And they are a far cry from the alarm raised by O’Dowd’s claims that FSD-enabled vehicles “indiscriminately mow down” small children. 

“In specific and rare circumstances,” NHTSA wrote in this week’s report, “certain driving maneuvers could potentially infringe upon local traffic laws or customs, which could increase the risk of a collision if the driver does not intervene.”

Tesla is not out of the woods quite yet, however. NHTSA clarified later that this does not close the books on a one-and-a-half-year investigation, which first began in August 2021.

In a statement provided to motoring website Jalopnik, NHTSA said this recall only addressed certain concerns within the full scope of the probe, which “remains open and active.” This suggests further regulatory action could be taken at a later date.

While the U.S. traffic safety regulator acknowledged in its report that Tesla refuted its findings, it said the company agreed “out of an abundance of caution” to administer a voluntary recall anyway.

The term “recall” can be confusing here, since none of the vehicles actually need to be brought to a mechanic. All that is required is an over-the-air software update that should be pushed out to owners in the coming weeks, according to NHTSA. 

Musk faces intense scrutiny and sometimes even anger over FSD

Recalls indicate action must be taken in accordance with federal laws and procedures, and be supervised and signed off by NHTSA. In such cases, it is illegal to continue manufacturing or selling any cars affected until compliance has been ensured.

That means Tesla cannot simply patch the software independently—the problem must be fixed to the regulator’s satisfaction. Whether Tesla must disable FSD in just the specific and concrete instances raised in the report is at present unclear.

Tesla has been facing intense scrutiny over FSD, a technology it first showcased in a 2016 video that is now known to have been intentionally staged, following testimony from its top software engineer. 

It was this video that launched Tesla’s claim of leading the industry in self-driving technology and first encouraged individuals like Apple cofounder Steve Wozniak to buy the feature at the time. Last week Wozniak accused Musk of being dishonest and misleading his customers. 

Lawyers for Tesla have argued that Musk’s inability once again to deliver on his repeated promises must be considered a mere case of failure rather than fraud in comments that help explain why critics accuse the CEO of a “fake it till you make it” strategy. 

But O’Dowd isn’t having it.

“Tesla’s FSD has undermined consumer confidence in self-driving cars at a time when industry and government should be developing systems that build public support for autonomous vehicles,” he said.